Which of the Following Would Not Be Classified as a Material

question 47

Multiple Choice

Which of the following would not be classified as a material participant in an activity?

• A) An individual who participates more than 100 hours a year and the person's participation is not less than any other individual's participation.
• B) An individual who participated in the activity for at least one of the preceding five taxable years.
• C) An individual who participates in an activity regularly, continuously, and substantially.
• D) An individual who participates in an activity for more than 500 hours a year.

---

Definitions:

Accounting Statements

Financial reports that provide a summary of a company’s financial condition, including income statement, balance sheet, and cash flow statement.

P/E Ratios

Price-to-Earnings Ratio, a measure of a company's current share price relative to its per-share earnings.

Quick Ratio

A financial metric that measures a company's ability to meet its short-term obligations with its most liquid assets.

Financial Statements

Formal records of the financial activities and position of a business, person, or entity, important for decision making.